Vodafone in Talks to Acquire Tikona Digital Networks’ 4G Spectrum

Vodafone is reportedly in talks to acquire Tikona Digital Networks’ 4G spectrum to expand its high-speed broadband network across the country and take over Reliance Jio Infocomm, Bharti Airtel and Idea Cellular.

Mumbai-based Internet service provider, Tikona had bought 2300 MHz (4G) spectrum in the 2010 auctions in Gujarat, Himachal Pradesh, UP (East), UP (West) and Rajasthan for over Rs 1,058 crore, and according to one of the sources, Vodafone has discussed “purchase of all” of Tikona’s airwaves in the 2300 MHz band, which would help the telecom major double its 4G presence from its current five circles.

As per ET, Tikona had earlier stated that it would launch 4G-LTE based broadband services in 30 cities across five telecom circles during the first half of 2016.

At present, only Reliance Jio and Bharti Airtel among the major telcos own airwaves in the 2300 MHz band. Bharti Airtel has already rolled out 4G high-speed broadband services in over 300 towns and cities while Reliance Jio has launched 4G services only for its employees, ahead of the full commercial roll-out in March 2016.

Vodafone, which doesn’t have 4G airwaves in that band, will deploy its high-speed broadband services over the 1800 MHz band across five circles of Delhi, Mumbai, Kolkata, Karnataka and Kerala. So far, it has launched 4G services across 10 towns in Kerala only.

The ecosystem around airwaves is seen to be developing very fast. Recently, Idea Cellular acquired spectrum held by Videocon Telecommunications in Gujarat and Uttar Pradesh (west) for Rs 3,310 crore. With this deal, Idea’s 4G spectrum footprint will expand to 12 circles covering more than 75% of its current revenue and over 72% of existing 170 million subscribers. Notably, it was Vodafone which first held talks with Videocon to buy its 4G bandwidth in the 1800 MHz band. But eventually, the talks went futile over valuation differences.

According to expert analyses, Vodafone’s market is likely to be more vulnerable to Reliance Jio’s pan-India service offerings than Airtel and Idea’s, given its comparatively limited 4G spectrum holdings.